State's housing market remains on track

Rob Varnon

Published 10:30 pm, Tuesday, April 23, 2013

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In this file photo, real estate for sale signs are shown on a traffic triangle on Coal Pit Hill Rd in Danbury. Despite cautious buyers in Fairfield County, where the number of days it takes to sell a home increased along with prices and number of sales, the local and national real estate markets continued to improve in the first quarter. less

In this file photo, real estate for sale signs are shown on a traffic triangle on Coal Pit Hill Rd in Danbury. Despite cautious buyers in Fairfield County, where the number of days it takes to sell a home ... more

Photo: File Photo

State's housing market remains on track

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Connecticut home prices and sales rose in the first quarter, further enforcing expectations that the market is recovering locally like it is nationally.

Prudential Connecticut Realty reported 1,187 homes were sold in Fairfield County in the first quarter, an 11.8 percent gain from the first three months of 2012. And, while the median sales price in the county rose nearly 5 percent to $400,000 in the quarter, the amount of time it took to sell a home here rose by 4 percent to 177 days. Statewide, the median price for a home rose 1.1 percent to $225,000 and the number of homes sold increased 8.8 percent from a year ago.

Given solid trends over the last few months locally and at the national level, where new home sales were up 1.5 percent in March, experts continue to expect improvement in the market to carry through the rest of this year.

"The positive signs for Connecticut's real estate market are very evident and there is good momentum in the marketplace," Candace Adams, chief executive officer and president of Prudential Connecticut Realty, said in a press release. "Based on our first-quarter report findings, sales should continue to recover throughout the year and this is the best time to get into the housing market."

But rising prices did slow sales down in two of the three counties where there were increases.

The number of days on the market for homes before they sold went up in Fairfield and New Haven counties, where prices rose significantly. In New Haven, they climbed 6.7 percent to $192,000, compared with a year ago, while Fairfield County's $400,000 median value was the highest in the state, representing a 4.9 percent rise.

He said he expects the state median price to climb into the range of $250,000 to $255,000. But to get there, lenders will have to loosen their standards, he said, like they have in other areas of the country.

One of the main issues confronting the Connecticut and even parts of the national market is income growth among families. Simply put, if housing prices continue to increase while income stagnates and the job market remains muted, fewer people will be able to buy homes.

Deak said lenders, who are sitting on a lot of cash, will have to start giving out more loans.

Prudential noted that new rental lease activity increased 2 percent in the quarter.

Of the six Fairfield County communities that saw a decline in the number of sales, two reported median values below $400,000, while the remaining four all commanded prices above $500,000.

It's not just local experts who see continued expansion this year.

CoreLogic, the California-based real estate data company, reported Tuesday it expects the market to continue to expand this year, driven by existing home buyers trading up and investors buying rental properties.